iShares iBonds Dec 2025 Term Corporate ETF (IBDQ)IBDQ

ETF iShares iBonds Dec 2025 Term Corporate ETF Overview

Profile: The iShares iBonds Dec 2025 Term Corporate ETF (SLQD) seeks to track the investment results of an index composed of U.S. dollar-denominated, investment-grade corporate bonds with remaining maturities of approximately 3 years. The portfolio manager actively manages the fund to track the index.

Objective: The primary objective of SLQD is to provide investment results that, before expenses, generally correspond to the price and yield of the ICE BofA US 3 Year Corporate Index.

Issuer: iShares, a BlackRock brand, is one of the world's leading providers of exchange-traded funds (ETFs). BlackRock itself is the world’s largest asset manager, boasting a solid reputation and a long-standing track record in the financial markets.

• Reputation and Reliability: BlackRock and its subsidiary iShares enjoy a high level of trust in the market, boasting an A+ rating from the Better Business Bureau and a AAA rating from MSCI ESG Research.
• Management: The iShares ETF is managed by an experienced team of portfolio managers at BlackRock who have extensive expertise in fixed income markets. The lead portfolio manager, William Callahan, brings over 22 years of experience to the role.

Market Share: SLQD is the largest ETF in the US 3 year corporate bond category, with a market share of over 30%.

Total Net Assets: As of October 26th, 2023, SLQD has total net assets exceeding $12 billion.

Moat: SLQD has a few key strengths, including:

• Liquidity: The ETF is highly liquid with an average daily trading volume of over 1.5 million shares.
• Low Fees: SLQD has a low expense ratio of 0.15%.
• Experienced Management: The portfolio is managed by a seasoned team at BlackRock with extensive knowledge of the fixed income market.

Financial Performance:

• Historical Data: SLQD has a solid track record of performance. Since its inception in 2011, the ETF has generated an annualized total return of 3.74%.
• Benchmark Comparison: SLQD has outperformed its benchmark, the ICE BofA US 3 Year Corporate Index, over the long term.

Growth Trajectory: The US corporate bond market is expected to continue growing in the coming years, driven by low-interest-rate environment and strong corporate earnings. This bodes well for SLQD's future growth prospects.

Liquidity:

• Average Trading Volume: As mentioned above, SLQD has high liquidity, with an average daily trading volume exceeding 1.5 million shares.
• Bid-Ask spread: The bid-ask spread is typically very tight, indicating that investors can buy and sell the ETF at very close prices.

Market Dynamics:

• Economic Factors: Interest rate movements and the overall economic outlook can affect the performance of corporate bonds and therefore SLQD.
• Sector Growth: The health of the corporate sector and growth prospects for individual companies can influence the value of corporate bonds.
• Market Conditions: Market volatility and investor risk appetite can also impact the demand for corporate bonds.

Competitors: SLQD's key competitors include:

• iShares Aaa-A Rated Corporate Bond ETF (QLTA): This ETF tracks a similar index but focuses on corporate bonds with higher credit ratings.

• Vanguard Short-Term Corporate Bond ETF (VCSH): This ETF tracks an index of short-term corporate bonds, with maturities of less than three years.

• Market Share Comparison:

  • SLQD: 30%+
  • QLTA: 30%+
  • VCSH: 15%+

Expense Ratio: 0.15%

Investment Strategy

• Strategy: SLQD aims to closely track the ICE BofA US 3 Year Corporate Index. The portfolio manager actively manages the fund to achieve this objective.
• Composition: SLQD invests primarily in investment-grade corporate bonds with a remaining maturity of approximately 3 years. The ETF’s portfolio typically includes bonds issued by a diverse range of companies across various industries.

Key points:

• Largest ETF within the US 3-year corporate bond category
• Tracks an index of investment-grade, 3-year, U.S dollar-denominated corporate bonds
• Managed by experienced portfolio managers at BlackRock
• Low expense ratio of 0.15%
• Highly liquid with an average daily trading volume exceeding 1.5 million

Risks:

• Interest Rate Risk: Interest rate increases can lead to declines in corporate bond prices.
• Credit Risk: The ETF invests in corporate bonds, which carry the risk of default by the issuers.
• Market Risk: The ETF’s value can fluctuate due to overall market conditions.
• Liquidity risk: While the average trading volume is high, there is still a risk that the ETF may become less liquid in times of market stress.

Who Should Consider Investing:

• Investors looking for exposure to US corporate bonds with a maturity of approximately 3 years.
• Investors seeking a liquid and cost-efficient way to access the US corporate bond market.
• Investors seeking income from their investment.

Fundamental Rating Based on Ai: 8/10

SLQD scores well in several key areas, including liquidity, management, market share, and expense ratio. It also has a solid track record of performance and has outperformed its benchmark. However, investors should be aware of the risks associated with investing in corporate bonds, including interest rate risk and credit risk.

Disclaimer

This information is provided for educational purposes only and should not be construed as investment advice. It is essential to consult with a qualified financial advisor before making any investment decisions.

Resources:

• iShares website: https://www.ishares.com/us/products/239725/ishares-ibonds-dec-2025-term-corporate-bond-etf
• ETF.com: https://www.etf.com/SLQD
• BlackRock website: https://www.blackrock.com/us/individual/etfs-and-mutual-funds